The Open Code Market 143
The Open Code Market
The peer reviewed magazine FirstMonday has published one paper I wrote on the business possibilities of Open Source titled "The Open Code Market".
In short, The Open Code Market aims to become a Free Market for software, as well as a market for Free Software. The OCM introduces into the Free/Open Source movement an economic incentive, to help align the priorities of Free/Open Source developers with those of the end users.
Between the final draft and publication, I received many valuable comments on the idea. I am very grateful to all those who dedicated some of their valuable time to read the paper and make insightful comments.
Some of those comments led me to an earlier similar effort by Brian Behlendorf named SourceXchange (originally at www.sourcexchange.com). After contacting Brian, his comments were probably the most valuable, since he had gone through the the actual proces of running a project similar to what I am proposing.
His main line was that:
a) while the market made profits, it did not reach the levels of profitability that were expected in the middle of the dot.com boom, and investors looked for other (more lucrative) endevours
b) That the dot.com boom also addedd costs (high salaries, etc) to his attempt and
c) that it is difficult to commoditise software creation due to the uncertainties over time / effort required to write the software, and the difficulty of the role of "project manager".
My line on all this is that
- The project may be easier to develop now as expectations for profits (and costs) have decreased, and that sourcing on low-cost countries (i.e. India, Vietnam, etc.) would reduce costs significantly.
- I also expect that the market will take off only as Free Software/Open Source (Linux in particular) moves to the mass market of the desktop, thus generating the necessary economies of scale, visibility and consumer-mass. In my idea, the target end-users of the market are not IT companies, but mainly individuals with no IT knowled (nor desire to acquire it) and Small and Medium Enterprises with small or no IT departments.
"
DIY'ers (Score:4, Insightful)
Re:DIY'ers (Score:2, Funny)
According to Dilbert the latter.
Re:DIY'ers (Score:1)
There be a clue in the title, there be!
Re:DIY'ers (Score:1)
I rather spend time running a business/empire/enterprise than configuring a computer. It is a better use of time. Granted, a system admin might come along with a new program or technique that will change the industry and make him rich, but what is the chance of that happening? Me thinks you would stand a better chance playing the stock market: just short SCOX-
Re:DIY'ers (Score:2)
Quite often, yes. It's the best use of my time if down the road it helps me accomplish something in the real world better or faster, or simply entertains me when I've nothing more pressing.
It's also a lot more enjoyable than pushing a wordprocessor or accounts-receivable program, and since I can get other people to do those gruntwork jobs for me, why shouldn't I do what fits my brain best?
Re:DIY'ers: OCM supports Plain Old Users (Score:2)
This is the big problem with current Open Source world, IMO -- the current Open Source world seems oriented toward DIY'ers creating code for other DIY'ers. Its a BOF community of computer and software-loving people. The result is code that only another coder would love. What fraction of Open Source software packages "just works" without configurat
Re:DIY'ers: OCM supports Plain Old Users (Score:2)
You say that as if it were a bad thing. Why do you feel this is a problem? I find it to be a solution.
If the purpose of any program it to be useful, then this is great. If the purpose of any program is to sell a billion units, then I suppose this would be a problem.
Re:DIY'ers: OCM supports Plain Old Users (Score:2)
Your point is excellent! Different types of computer users want different types of software. Code for coders is beautiful.
I agree with you that "useful" is important and that software does not have "to sell a billion units". But I would argu
Re:DIY'ers: OCM supports Plain Old Users (Score:2)
What are you saying here? - surely the only people qualified to appreciate code are coders.
"...away from cool code and toward ease-of-use."
There's no link between the quality of the code and how easy to use it is. An easy to use interface is not indicative of the quality of the code and vice versa.
"...make mainstream code, not coder's code?"
If by "coder's code" you mean good elegant code that's not cranked out to meet commercially driven deadlines
Re:DIY'ers: OCM supports Plain Old Users (Score:3, Informative)
I'm not sure about the overall fraction of open source, but I think that the majority of the most "popular and common" open source a
ONL -- Open-source Not Linux (Score:1)
No need for a restricted-access model (Score:2)
Your $10 could get you something other than the final software. It could get you:
Basically, you could pay a bit of money to have some control over the development process.
Re:DIY'ers (Score:2)
Oh, yeah, some of the "good guys" will discover such a talent for making their businesses grow that they'll forget their original motivations a
Copyright (Score:1)
Try before Buy (Score:4, Interesting)
Better than Try before Buy (Score:3, Insightful)
OCM would seem to support the commissioning of software projects or modifications. Thus I could go the Market, submit a request (e.g., "I want a real-time transparent version of CVS") and various groups might make counter-offers of
Re:Better than Try before Buy (Score:2)
this all sounds great... (Score:5, Insightful)
try explaining the good side of open-source programs to people who have never written a program in their life... you'll see what I mean...
I can't see much revenue comming from ordinary computer users who would see this as a 'hacker's' network or something. where they should direct themselves is towards the programming communities and (mostly) businesses...
Re:this all sounds great... (Score:4, Insightful)
Granted, she did not come into the situation with a bias against it, but several of the people I know have.
I know it feels good to say that we who watch
Personally, I take the view that humans are pretty smart.
Re:this all sounds great... (Score:1)
I never have, and never will make that claim...
it is possible to explain most of the concepts of open source to just about anyone.
i'm not talking about computer-illiterate... i'm talking about the people with a basic knowledge of computers and how they work. the people that encrypt their emails because they think it will hide what they're sending from a network admisitrator...
Re:this all sounds great... (Score:2)
> network admisitrator...
And won't it ? I consider myself a competent network administrator, but barring local access to the sending or receiving computer I couldn't read an encrypted email. What did you mean by this ?
Re:this all sounds great... (Score:2)
Encryption can't be relied upon 100% if you're keeping secrets from a large government or corporation and are worth their trouble to care about, but in all other situations, you're pretty much certain that it won't be broken. (Assuming a good implementation of strong crypto, yadda yadda
Re:this all sounds great... (Score:2)
If it's the former, blame the user (what are you doing giving out your passphrase??). And if you're into keeping secrets from the gov't (and the gov't cares), you should have your secret key (protected by a strong passphrase) stuffed away in a USB key that you keep on your person at all times.
If
Re:this all sounds great... (Score:1)
I should be more specific there... i was talking about somebody who has the police working with a network admin to check the emails...
Re:this all sounds great... (Score:1)
That's not really fair though. I'm not arguing against the merits of open source, but I can get my three year old to agree with me on most things because he lacks familiarity with the subjects to form an opinion of his own.
Re:this all sounds great... (Score:2)
Yeah, but she's a computer-illerate Mom, which is about three steps on the evolutionary ladder above PHB's. _She_ will listen to reason and consider alternative ideas presented to her.
My wife isn't very computer literate either (though I have taught her enough so that she can start teaching herself, she completely set up and installed a laser printer without my help which impressed me), and she
Re:this all sounds great... (Score:2)
You must be new to this planet. <g>
Re:this all sounds great... (Score:2)
Realy shouldn't be to difficult, didn't some guy named John F. Nash get a Nobel Prize in economics for basicaly the same thing?
Well OK the movie said it was about getting a bunch of nerd's laid, and how their chances would be imporved by cooperating, that's pretty much game theory and like open source code developement isn't it.
Re:this all sounds great... (Score:2)
Yes, in essense, he proved mathematically that there are cases where collaboration is far more efficient than a purely rivalrous market.
His work has been used in anti-trust cases (illegal collusion) but also other legitimate market analysis. This proposed "Open Code Market" and the OSS community in general would most definitely be relevant. (Anybody looking for a thesis idea?)
Re:this all sounds great... (Score:2)
Take me to your leader, he must be one dumb SOB... I'll take over your planet in less than a week while I've got him chasing the imaginary shiny thing under the table (same technique I use with most of those "pretty smart" humans you speak of).
Re:this all sounds great... (Score:2)
It seems I misspoke somewhat. Let me rephrase:
Personally, I take the view that humans (as indivdiduals) are pretty smart, but collectively manage to do some really stupid things. Unfortunately, research shows that humans in groups actually make better decisions than do individuals.
Sorry to dissappoint.
this all sounds great... but it's not a market (Score:4, Insightful)
Market failure can also occur when people who have not paid cannot be prevented from consuming the good, a condition called nonexcludability. Public goods by definition exhibit both jointness of consumption and nonexcludability.
Ergo, it may be a resource, but it can't be called a market.
Re:this all sounds great... but it's not a market (Score:3, Interesting)
I've been on both sides of the fence and technically I still am, but I'm a lot closer to being all the way on the FSF side these days.
For years I've worked in educational multimedia publishing and I've seen the market go all to hell, but I'm still in because I did so much work in the past that there's no such thing as being out. New work in the same vein is
Re:this all sounds great... but it's not a market (Score:1)
The problem comes when people start thinking that they have a hope in hell of maintaining exclusive control over reproduction/dissemination of the idea (once they've released it).
That used to be just about viable in the days of printing presses and book binding.
These days, if you want to sell an idea you have to sell it when you release it. This is because it is only property in the strictest definition of the word whilst it's in your exclusive possess
Re:this all sounds great... but it's not a market (Score:3, Insightful)
The true product in this market is not the software, but the developer time. If a developer is working on one commission, other consumers cannot also be getting work done from that developer on their commissions. So, the consumption here is rivalous.
The nonexcludability portion I do agree with.
Re:this all sounds great... but it's not a market (Score:2)
That is precisely correct. This is a market for labor and services, not a market for goods. Software only needs produced once.
Somebody mod parent up!
Re:this all sounds great... (Score:1)
Re:this all sounds great... (Score:1)
Re:this all sounds great... (Score:2)
"It's free."
(this lasts til some other nearby geek decides to put on a dominance display and quibbles over the connotation of "Free")
Re:this all sounds great... (Score:1)
Re:this all sounds great... (Score:2)
For most open source, you can't stop the first person who pays for it to turn that equality into an equality (and yes, I'm still talking free as in beer). Otherwise you're talking about source licensing of otherwise closed source, and frankly if it's not open to the public, it's not particularly open source.
Bah. I'm getting suckered into one of these aforementioned displays already.
Re:this all sounds great... (Score:1)
Re:this all sounds great... (Score:2)
Okay: the good side of open-source programs is that you can get programs which meet your need but could never make it to market because the number of people with such a need is too small to make it profitable.
Simple enough?
Re:this all sounds great... (Score:1)
Levels of profit expected during dot.com boom? (Score:3, Funny)
I that was what was expected during the
Some questions (Score:4, Insightful)
The obvious answer is of course that the code can be seen and updated by the OSS community but IMHO most don't see the value in that and would rather stick with their own development team to do their work for them (think the Microsoft argument of having someone to fire).
My guess would be that it's effectively the same for them (since they could commission patches much the same as they could pay their programmers to update software) but again, management probably doesn't like it that they have to pay someone out of house to do it.
It's about time that someone created a method such as this to make the creation of open source code generate some funds for the programmer. If companies can see that keeping these programs open can be beneficial not only to them in the support of the OSS community but the the industry as a whole then I think everyone should be benefitted by something like this.
Re:Some questions (Score:1)
Actually, I think companies will see a major advantage in paying for new features in free software. Instead of having to bear the full cost of adding a feature to the code, they'll be able to pay only a fraction of it by throwing money in
You hit the nail on the head (Score:1, Insightful)
Bingo, and that is the flaw. There is no way you can compete on cost with developers in Russia, India, China,
Re:You hit the nail on the head (Score:2)
In practical application, people will trust the original developer/team more than a third party hired to add a feature. If a th
Something like Expert's Exchange? (Score:3, Informative)
Re:Something like Expert's Exchange? (Score:1)
Re:Something like Expert's Exchange? (Score:2)
Personally I think its a pretty naive approach to an idea that
Much, much cheaper (Score:1)
Re:Much, much cheaper (Score:1)
Moreover, you can extrapolate from "several companies pledging smaller amounts" until you reach "thousands to millions of end users pledging even tinier amounts".
A small mental step for you, but a giant paradigm shift for mankind.
Re:Something like Expert's Exchange? (Score:1)
Just find the right service model (Score:2, Interesting)
The right service in this case is geotargeted advertising for local businesses wanting to gain some visibility on the net. It's an extension of a proven business model used by search engines like Google.
The plan is there's no need for developers to be paid for their code, they just earn money by participating in the advertising service by operating the location searc
Mixed gut reaction... (Score:3, Insightful)
Suppose right now today my company wants a custom feature or a bug fixed in some OS software. We can pull out our checkbook and hire X to do Y for $Z. If it's OS work, that's just part of our contract. AFAIK, this happens already.
So what is the innovation here? To create a "market" that is basically a consulting company for OS work? Doesn't seem to be...after all, the article specifically says this is not limited to GPL (and that didn't seem to be followed up with "or other open-source license"). It says open code, but does that mean the results must be open or simply the basis must be open and the end results can only link to open libraries if they are closed?
Or is it to create a consulting company that uses contractors? I don't believe that's it either... contract consulting work is already routinely outsourced and sub-contracted.
Or is it to organize a commercial venture based on the work of OS? This might be the real heart of the issue. There is where I get mixed:
Surely funded development of OS software advances them, but this could turn sour quickly (think Red Hat!). Now, with varied customers with individual requests I'd like to think that the market could not take on a direction with its own agenda, but I would like to hear some arguments for and against this. The model indicates this is for-profit. Thus, requests from the highest bidders would probably get preference. Supppose MS throws a few billion at time-consuming features that add little value to the product. Why wouldn't this market eat that up? But think about the cost of this. While developers add features such as scrollbars changing color through a gradient to indicate how far down you've scrolled, they are not working on fundamental issues that need to be addressed before they blow up in our faces. Suppose SCO hires a company to request a feature which would infringe on SCO's IP such that there is a genuine IP infringement that they don't appear to have set up directly.
I, for one, would rather have talented developers working on things like IPv6 implementation, that commercial investors probably won't want to fund, or at least wouldn't be able to compete with people who use the market as a tool against OS.
I think any time something this scale is set up, it should be very carefully critiqued. Unfortunately, there's nothing stopping anyone from doing it if it turns out to be a set-up for OS disasters.
Re:Mixed gut reaction...Debug needed (Score:1)
Maybe it's just me, but I find this sentence extremely difficult to parse. I think it's a special case for off-duty bookeepers....
SourceXchange reborn (Score:2, Informative)
Open SourceXperts.com [opensourcexperts.com]
Complete with the lame eX. It only launched on 10 November, so be gentle with yor 'how quiet here' comments.
"dot.com" (Score:3, Funny)
Re:"dot.com" (Score:2)
h t t p colon slash slash slash dot dot org
Am I missing something? (Score:4, Insightful)
Err, hello? RH desktop...dead. SUSE...wounded by Novell. SCO is bleeding any OSS-involved company with litigation. Who's going to take linux to the desktop or "mass market" as suggested here?
I'm not saying this guy is wrong, but the OSS world has got some damage control to do. I'm confident it will pull through (my paycheck depends on it) but I would rethink using this as a justification for this project's market readiness.
Re:Am I missing something? (Score:2)
How you managed to mistake "bankrolled" for
"wounded" is a puzzle.
No, SCO isn't bleeding anybody with
litigation. IBM isn't even sweating, let
alone bleeding, and SCO has no other cases.
What problem? (Score:1, Insightful)
Of the several problems F/OSS faces today, one is the fact that it is free. Not as in freedom, but as in free beer. Both private users and business are at a loss when it is explained that there are thousands of people developing Free Software, for free. The immediate reaction is of disbelief, followed by the assumption that the software must be of low quality...consumers and businesses work for money, and they mistrust people who do not.
Except the software is increasingly being used, and
Re:What problem? (Score:2)
the business model of selling bad software and buying out any competitors who make anything better?
Skimming the article... (Score:2)
I guess his primary difference is the OCM is the contractor.. "subcontracting" the coders instead of some completely un-regulated bid-market.
There's something here for everyone. (Score:1)
What are the connotations of this applied on a large scale though?
Blogzine [blogzine.net]
The point? (Score:4, Insightful)
Programmers write code because that's what they love to do. This is why there are dozens of editors, mailers, etc, rather than a single well-maintained application of each type. A coder says to himself "I feel like writing yet another mp3 ripper GUI". He proceeds to do so despite the fact that numerous examples already exist because his motivation is his own pleasure, rather than a desire to fill some gap.
Trying create a carrot to dangle in front of these people is pointless. They don't want your carrot. They want to write the code that they want to write.
Re:The point? (Score:4, Insightful)
I've done plenty of projects, for pay, where I take my employer's requirements, make them my own, and enjoy it. In fact, I end up having more motivation than if I were working on something for myself, as there is the money factor to go along with the pleasure factor.
Also, your assessment of motivation for open source coders is flawed. There is indeed a gap to fill, though it isn't usually shared by large numbers of people. In most cases, a coder writes a piece of software because it fills a need for that individual coder - it's not simply a case of "I feel like writing yet another mp3 ripper GUI," but instead more of a case of "I don't like any of the mp3 ripper GUI's out there, so I'll write my own."
Re:The point? (Score:2)
frankly... no. I want to do what I enjoy. Money doesn't come into it. Ofcourse, that's impossible... but it IS what many people want.
Re:The point? (Score:1)
The code I write for the company that employs me is generally work I have to do. No "save the world" type of stuff. It's just business.
The code I write for the OSP is for fun. I like it. It's my hobby. This is why I do it. If I were to be paid for it, it might start feeling like a job, and that wouldn't be much fun...
I cannot see myself working on an "Open Source" project and be paid for it as well.
If I wanted to make ext
Re:The point? (Score:2)
I'd say most open source hobbyist coders do it for both reasons actually. While noone would do it if they didn't enjoy coding, it really is very satisfying to get emails from users telling you how cool they think your software is.
Re:The point? (Score:1)
Your assumption that coders do projects because "they feel like it" is wrong and assuming. We scratch an itch like someone else said here. We do something because something either doesn't work, there's no open source equivalent out already, it's new and innovative, or what's there simply doesn't do what we need it to.
Re:The point? (Score:2)
Uh yeah, that's the whole point of trying to arrange an alternate system so that other coders can write the code that end-users are willing to pay for. It's not like free open-source development would go away, but if you want a new feature added to your favourite app you can pay someone to add it instead of learning C and coding it yourself.
I would imag
Not to seem arrogant, but (Score:3, Interesting)
The one thing Microsoft has done well is focus on end users. They are able to hock woefully inferior file, database, and mail server solutions because they make sure that Word's macro engine can cook your breakfast for you if you want it to. If users want a feature, it will be in the release product - performance, stability, and security be damned.
I don't necessarily think we should follow MS in this regard. It doesn't seem to have really worked out for them. Let's focus on what is really attracting people to free software - choice.
Re:Not to seem arrogant, but (Score:1)
It does, however, bring up an important point. If a developer leaves behind a bug, is he required to fix it without pay, or does he get paid to fix it? There could be some nasty loops in there.
Re:Not to seem arrogant, but (Score:2)
I guess my point is that if a developer leaves behind a bug, people will choose to use other software. Moreover, the history of free software does not demonstrate the need for an artificial economy of quality - free software is already consistently better than that produced by the commercial marketplace. The point about user focus can be made, however, which is why I addressed it.
Here's a question
Re:Not to seem arrogant, but (Score:1)
Re:Not to seem arrogant, but (Score:2)
Sure, becoming the #1 company in the world and the richest man on earth just proves your point, doesn't it?
Microsoft has decades before dissapearing, and will lead the software industry (in terms of revenue) for the coming years for sure.
Re:Not to seem arrogant, but (Score:2)
Are you suggesting that the users, writers, and adherents of free software are trying to accomplish those things? Your argument to someone considering free software instead of Microsoft is that Microsoft will make more money if they do?
TopCoder Software is already doing this (Score:5, Informative)
http://software.topcoder.com/
In short they are trying to put a structured, process-oriented community development model into a design / development competition format (with cash incentives, both upfront and as royalties) for creating new software. The resulting work is marketed as a component library, and the community itself is marketed as a "no-shore" development resource.
Check it out, it is a pretty good system -- the results are surprisingly good. I regularly participate in these projects.
Re:TopCoder Software is already doing this (Score:1)
Interesting...
8-PP
A bazaar in cathedral clothing... (Score:5, Insightful)
+1 Perceptive
The communities are not separated. The high level of communication between developer, tester, and user is the greatest strength of OpenSource software. They are sometimes the same person! By introducing a "clearing house" you are adding a middleman and thereby reducing efficiency.
+1 Perceptive
This is a difficult problem. Really difficult - and essentially unsolved by traditional development models. OpenSource itself is a solution to this problem. Code reviews, while one of the most useful tools for preventing these problems, are also one of the most labor-intensive (read "expensive").
Re:A bazaar in cathedral clothing... (Score:2)
I personally believe that society as a whole has more to gain by embracing the benefits of sharing, than to see OpenSource become as systemitized and hierarchical as much of the rest of our society.
You make some good points but I think that your worries are unfounded. There really is no way that OSS could become as "systematized and hierarchical", for the simple reason that the source is available and anyone who chooses to work outside the system is completely free to do so.
Sure, it's possible that a
Re:A bazaar in cathedral clothing... (Score:2)
Certainly a market that does not permit this sort of negotiation is sub-optimal, but there's no reason to think that the market described in the article would prevent it.
I just read the article more thouroughly (just skimmed it the first time), and I retract this statement.
A market like this that wants to work needs to incorporate a mechanism whereby users and developers can communicate to to negotiate their way to a final set of requirements. I think the author believes the Project Consultant can do
Re:A bazaar in cathedral clothing... (Score:1)
A gift culture is not orthogonal with a money-based economy. There is an interesting work by Bernard Lietaer (The Future of Money [transaction.net]) that deals with the effect of complementary community-base
Liability (Score:3, Interesting)
If company A is using an open source product and said product causes a customer of company A to lose millions of dollars whos is liable? Some may say company A is liable which may or may not be true, but lets remove company A now. Many businesses want someone to be "responsible" for the software they use. If that software is written inhouse or by a third party then the liability is obvious. If open source is used would you go to source forge (as an example) and get the user ids working on the project and sue them for liability? You see businesses can't just think about what is the best piece of written code, but also perhaps which piece of code will cover its backside the best. Is that the best situation? I do not know, but it is a situation that exists, why do you think major corporations and even small business owners have lawyers and liability insurance?
Re:Liability (Score:1)
They may want that, but do they get it? Try reading any EULA from Microsoft (or any other large software house). They disclaim everything under the sun. Whether those disclaimers will hold up in court is another matter; but then so is whether disclaimers in Open Source software would similarly hold up.
And what if the company you're dealing with goes under or (more likely in Microsoft's case) discontinues support for the product
Re:Liability (Score:1, Informative)
2 the main reason why developers moved away from the public domain to OSS licenses is that you can only use the software if you accept you cannot sue the developer
3 buyer beware - with open source, you have the right to view (the source) before buying (using)
4 liability is expensive. if you want to be able to sue, buy your OSS software from someone who's willing to offer you liability. it's like that this is an insurable risk (
Re:Liability (Score:2)
If MS software where to suddenly explode, you wouldn't be able to hold Mr. Gates accoutable. Now, I think that chaging for software should include some kind of warranty at least at the process level, etc. Companies and individuals alike should be liable if they sell a product for money, they should offer a warranty with respect to that offering.
The warranty
Are we all lemmings? (Score:1, Insightful)
Re:Are we all lemmings? (Score:3, Interesting)
This [guardian.co.uk] article points out that lemmings "do not, however, commit mass suicide by leaping off cliffs, a myth compounded 45 years ago by Walt Disney's White Wilderness film - which showed lemmings apparently going to their doom."
Re:Are we all lemmings? (Score:2)
Free software are the tools so that companies and users can put those technologies to good use. It's not an end in itself, as the need for programmers is vast and diverse.
What you need is free tools at some levels, so that not one company can monopolice a large chunck of it. Your
Re:Are we all lemmings? (Score:2)
All, except the writer, are producing physical (tangible) products or services. They're selling a truely limited resource - physical items or time. It's natural to make an exchange for any limited resource. Words and computer code, however, are unlimited resources. The only limits are artificial. Many writers do give away their work for free, or almost free. It's nearly impos
Public Software Fund (Score:5, Interesting)
-russ
Whats wrong with latin-1 characters? (Score:1)
Intellectual Property!! (Score:2, Interesting)
The article does not even mention the words "intellectual property." Something to consider!
But Linux won't any time soon... (Score:2)
Okay, first off I am a technology consultant that focuses on helping SMB's (I g
Real world GPL commercial compatibility (Score:2)
Let us assume that company X wants to make a product, let's call it PhotoX, which it would like to sell in competition to Photoshop
Missing References (Score:2)
There are also some additional references to related market-forms here [www.ms.lt]. Google Answers [slashdot.org] also works on a somewhat related principle.